Benefits In Kind Flashcards
where the benefit is an asset eg painting, what is the taxable amount
5% of market value for each year the asset is held
where the benefit is a motor car, what is the taxable amount
BIK on % on OMV subject to annual km limits
what does OMV stand for
Original Market Value
what is OMV
the market value of the car when it was first registered
net of trade discount
ie not the value of the car when it was provided to the employee. eg if employee gets a second hand car the OMV is still the original selling price
what type of employee contributions can be deducted from the taxable value (relating to motor vehicle)
contributions made directly to the employer
eg not to a mechanic
if there BIK for electric cars and vans given between 1 January 2018 and 31 December 2018
no
Company Car valuation steps
- Get OMV
- Apply %
- Reduce by ref to no of months in use
- Deduct employee contribution to employer
- Review - is alternative treatment available eg with low business mileage
if the employee pays for the car insurance or tax can this reduce the BIK
no
what to do when the company car was only available for part of the tax year
identify number of days used
identify business km in that period
business km * 365/days in use = annualised business km
check that figure in table to find %
OMV * % * daysused/365
Conditions for relief for certain employees with low business
kilometres
works >= 20 hours per week average
8000 <= business km per annum < 24000
spends 70% of working time away from premises
retains detailed log book
what is the relief for certain employees with low business km
reduce cash equivalent by 20%
BIK for company van
5% of OMV of Van
where is there no BIK for company vans
- van is necessary to perform duties of employment eg delivery
- required to keep the van at home when not in use
- private use of van is prohibited
- 80% of time away from work premises
- car or van pool
what BIK is expenses paid by employer for accommodation where employer does not own the accommodation
full of whatever they paid
what is the BIK when the employer owns the accommodation
8% of the OMV of property
